Namdia defends N$151 000 client fee

NAMIB Desert Diamonds (Namdia) has moved to defend its pricey application fee to become a Namdia client which is pegged at a non-refundable US$10 000, approximately N$151 142.

The diamond sales and marketing company, which buys and sells diamonds on behalf of government has publicly called for new diamond buyers that have been given an October 30 deadline to submit their application.

Upon inquiry by Confidente following a public outcry, Namdia spokesperson Usi //Hoëbeb told Confidente this week that all potential Namdia clients will be subjected to a thorough due diligence process, aligned to industry best practices and international compliance requirements which must ensure that clients are not involved in organised crime.

The requirements will also ensure that Namdia clients do not involve inmoney laundering activities, financing of terrorism, use of child labour and engagement in other unscrupulous financial offences andcomply withthe Kimberley Process of International Certification Scheme for rough diamondsin line with provisions of the Diamond Act (Act 13 of 1999).

“Furthermore, Namdia will subject all potential clients who have responded to structured and rigorous vetting and selection processes/exercises in line with the above. The application fee quoted will be used to perform these exercises, which entails many procedures, process and logistical arrangements to be conducted by Namdia and its partners to ensure that potential clients are in compliance with the above,” he justified.

Namdia’s annual report for 2016/17, tabled in parliament this year, showed that the parastatal bought rough diamonds from the NDTC – a joint venture between the government and De Beers – for N$750 million, and sold them for N$860 million, recording a profit of about N$110 million.

Last week the Namibian quoted Namdia as saying that 10 companies might be selected to buy the gems from the state entity over two years.

Namdia currently sells diamonds to five companies, out of 20 companies that were secretively selected by the government in 2016.

“The [Namdia] board of directors had resolved to open up the process to new clients. This is the start of that process to seek new clients,” //Hoëbeb told the Namibian.

NAMDIA was established in 2016 by the government to serve as a “window on the international diamond market”. This implies that Namdia can, through its purchase entitlement from the Namibia Diamond Trading Company (NDTC) of 15 percent representative cut-off of the NAMDEB Holdings production, go outside of the traditional sales system.

This is an outcome of the sorting, valuing, sales and marketing agreement concluded in 2016 between the Namibian Government and De Beers, which amongst others, made provision for greater allocation of local diamond production to the local diamond industry and which ultimately led to the establishment of Namdia.

In terms of this agreement, Namdia buys 15 percent of NAMDEB Holding’s run-of-mine production from NDTC.